Air Transport Management

Session 8: Fleet Planning

Dr. Rohafiz binti Sabar

Transport and Logistics Department
Room 2055 , STML
D/l: 04-9287048
email: rohafiz@uum.edu.my
July 2009 Transport and Logistics Department 1
 Fleet Planning Process in Airlines-
What Comes First?
• The fleet is a tool to deliver profit; the fleet
plan a tool to help deliver the airline’s strategy
• In a large network carrier, a Fleet Plan always
exists: should it be changed? How?
• The Airline’s strategy has a fundamental
influence on the fleet plan, but…..
• The existing fleet and commitments influence
the marketing plan, schedule, network and
even the Strategy of the airline.
 Late 90s Product Strategy
• Grow and defend long-haul premium
• Reduce exposure on economy transfer traffic

• Reduce aircraft size (“right-sizing”)

• Use more space for business class
 Establishing Demand
• Need to know the demand the fleet is seeking to meet
• Focus on profitable demand
• Origin/destination demand, total market, each city pair
- Historic traffic recorded plus estimated (eg low frills)
- Growth rates
- First, business, high yield economy, low yield
- UK originating, Outside UK originating
- for each year of study
- for each scenario
 Establishing Demand
• Immensely complex!
• Vital to identify the important elements for a
fleet study – focus on the differences
• Sensitivity analyses as important as the main
analysis – and help negotiations
Taking your own historic demand and applying
industry growth rates will produce a bad decision (e.g.
AA ordered too many A320s)
 Fleet Assignment Model

• Vital tool – total involvement of network

planning experts is essential
• “Black-box” risk – cross-checks and
common sense checks required (e.g. use
simple market growth approach and
explain differences)
• Sensitivity analyses are as important as the
main analysis
 Aircraft Evaluation

• Operating Costs
– Value of commonality/cost of complexity
– Introduction costs
• Turnround times and utilisation
• Payload-Range; cargo potential
– Do you need the range (don’t buy for one route)?
– Specific to your airline
• Environmental factors – need wide margin
– Commitment to 25% reduction in fuel burn per pax km 2005 - 2025
– Model impacts of emissions trading/fuel tax
– Improved local air quality is a pre-requisite for Heathrow expansion
– QC noise number for LHR arrivals

Demonstrate airline is “environmentally

responsible”
• Configurations
 A321 Cabin Layouts (illustrative)
Two-class: 185 seats

16F at 36in + 169Y at 31/32in pitch

Alternative two-class: 167 seats

C

C C

30B at 39in + 137Y at 32/33in pitch

(For long-haul, seats abreast can be critical)

 Passenger Preferences
• What are they prepared to pay for?
• Direct or via a hub?
• Space e.g flat beds.
• Do they know what they are flying on?
• Size: can a/c be too big? Too narrow?
– A320 vs 737 width?
• Cabin noise, lighting, ambience
• Speed?
• The latest technology?
• Contribution to Global Warming?
 Aircraft Evaluation
• Operating Costs
• Turnround times and utilisation
• Payload-Range
• Environmental factors – need wide margin
• Configurations
• Passenger preferences
• Complexity (min fleet size 10?)
• Flexibility
–options, upgrades/downgrades, deferral rights,
–reconfiguration flexibility